FX.co ★ Fragile Sentiment Keeps Rupiah Under Pressure

The Indonesian rupiah traded around IDR 17,720 per U.S. dollar on Monday, extending its slide for a third consecutive session even as the dollar index eased from six-week highs. Hopes for a U.S.–Iran agreement have tempered oil-driven inflation risks and cooled expectations of additional Fed rate hikes, weighing on demand for the safe-haven dollar. Still, sentiment toward Indonesian assets remains fragile amid persistent global headwinds, including rising U.S. yields, elevated crude prices, and ongoing capital outflows.

Additional pressure came from the current account, which posted its deepest deficit in more than six years in Q1 2026, heightening concerns over Indonesia’s external balances. Markets also largely brushed aside comments from Finance Minister Purbaya Yudhi, who suggested the rupiah could rebound sharply to around IDR 15,000 under new regulations requiring resource exporters to keep their export proceeds in local banks for at least 12 months. Year-to-date, the rupiah is down about 6.1% against the dollar, making it one of Asia’s weakest currencies alongside the Indian rupee.